financial statements

1. What are the four basic financial statements and what can you learn about a company from each one? (Don't tell us what is on each statement but rather what can you learn by analyzing the statements)

2. Discuss the general factors that influence the quality of a company's reported earnings and its balance sheet.

Problem 2

Balance Sheet(walmart)
Total assets $10,000,000
Accounts payable $ 2,000,000
Notes payable (8%) 1,000,000
Bonds (10%) 3,000,000
Common stock at par 1,000,000 Contributed capital in excess of par 500,000
Retained earnings 2,500,000
Total liabilities and stockholders' equity $10,000,000

Question-
Compute the return on stockholders' equity if (walmart) has sales of $20 million and the following net profit margin: and show ALL work
a. 3 percent
b. 5 percent

Insurance planning
1-Discuss the problem of moral hazard. How does the insurance company manage this?
Give examples

2-Discuss the concept of income replacement in determining an insurance need
give examples

Question 1

A life insurance policy is a contract governed by federal law.
True
False
2.5 points
Question 2
 The principal economic purpose of life insurance is to accumulate capital.
True or False
Question 3

Life issurance is essentially an investment vehicle that ensures a desired wealth accumulation by the time of death, regardless when death occurs.
True
False
2.5 points
Question 4

The income replacement approach assumes the insurance should be equal to the value of the person's future earnings potential to the surviving family members.

True
False
2.5 points
Question 5

Insurance companies base their mortality assumptions on
  the experience of large groups of people
  published mortality results of other large life insurance companies
  federally mandated mortality tables published by the Treasury Department
  the individual assumptions made by actuaries employed by the company
2.5 points
Question 6
The "multiples-of-salary" method of estimating the amount of a family's insurance needs is
   a rule of thumb method that determines insurance needs by looking at the number of children in the family
  a method that was repealed by the Taxpayer Relief Act of 1997
  a method combining a simple rule of thumb method with elements of income replacement and needs analysis
  a method that can be used only by individuals who are properly licensed with the FAA
2.5 points
Question 7

The income replacement approach to determining a family's insurance needs is based primarily on?
   the earnings growth rate of long-term U.S. Treasury securities
   regulations issued by the Department of Health and Human Services
   the current balance in the accumulated adjustment account
  the human life value concept
2.5 points
Question 8

 All of the following are primary life insurance planning areas, except
   income replacement and family needs
   portfolio value and allocation of assets between debt and equity instruments
   business insurance needs analysis
   estate preservation and liquidity needs